It's like tipping a rapist.......

http://atheonews.blogspot.com/2009/03...

March 21, 2009
Obama maneuvers to protect Wall Street bonuses

By Barry Grey
21 March 2009

Following the passage Thursday of a bill by the House of Representatives that would tax some bonuses at a handful of companies that have received government bailout money, the Obama administration is seeking to discourage passage of a similar bill by the Senate, even as Obama feigns indignation over $165 million in bonuses awarded by the bailed-out insurance giant American International Group (AIG).

Obama is attempting to navigate between placating public anger over AIG and similar outrages by Wall Street firms that have received hundreds of billions of dollars in taxpayer funds and satisfying the demands of the financial elite, which will brook no government interference in its drive for self-enrichment.

Responding to an outpouring of public anger over the revelation that AIG, the recipient of $173 billion in government loans and cash, last week granted large bonuses, some in the millions of dollars, to executives and traders in its financial products division, the House voted 328 to 93 to impose a 90 percent surtax on bonuses given to employees with a family income of $250,000. The bill covers only firms that have received $5 billion or more in government handouts under the $700 billion Troubled Asset Relief Program (TARP) and other financial rescue programs.

The financial products division was the unit of the insurance company that sold trillions of dollars worth of credit default swaps to banks, hedge funds and other financial companies to insure their investments in collateralized debt obligations and other exotic financial instruments backed by subprime mortgages. It played a major role in erecting the financial house of cards that has come crashing down, effectively bankrupting AIG and much of the US and international financial system and plunging the world economy into the deepest recession since the 1930s.

All but six House Democrats voted for the bill and nearly half of House Republicans joined in support, defying House Minority Leader John Boehner, who opposed the measure. The bill is retroactive, covering all bonuses at affected companies granted after January 1, 2009. It thus includes the AIG bonuses that have become a focal point for public anger over the entire government bailout of Wall Street.

The House bill, in fact, covers only 13 of the more than 500 companies that have received some $250 billion in cash infusions from the US Treasury. In addition to AIG, the list includes Citigroup, JPMorgan Chase, Wells Fargo, Bank of America, Goldman Sachs, Morgan Stanley, PNC Financial Services Group, US Bancorp, General Motors, General Motors Acceptance Corporation and the mortgage finance giants Fannie Mae and Freddie Mac.

The Senate version, which could be voted on as early as next week, covers a wider range of firms—those receiving $100 million or more in government cash. It would impose a 70 percent surtax on most bonuses at these companies, half to be paid by the individual recipients and half by the firms.

The aim of the House and Senate measures, far from fundamentally reforming the financial system or requisitioning the vast fortunes of Wall Street speculators, is to mitigate public anger in order to pave the way for passage of a new round of bank bailouts being prepared by the Obama administration.
[Rest of article at URL at top of page.]

Promote

0 members promoted this

Rating: